BDAN laments huge operating expense of Banks
The Bank Directors Association of Nigeria (BDAN) have lamented the huge operating expense of Banks occasioned by multiple levies from regulators.
The BDAN Chairman, Mr. Mustapha Chike-Obi speaking at year’s Bank Directors Association annual conference had the theme, “Emerging Issues: Navigating the Complex Balance Between Regulation and Compliance,” called for reviewing or scrapping of the levy charged on commercial banks by the Asset Management Corporation of Nigeria (AMCON). He made the call during an opening remark at the annual bank directors conference in Abuja recently.
According to him, an AMCON levy and a Nigerian Deposit Insurance Corporation (NDIC) premium was “a difficult issue for the banks.”
He said, “Right now, the second biggest operating expense of banks is the AMCON levy after staff salaries, and it has the potential to become the largest.”
The Chairman of BDAN stressed the need for a resolution and warned that paying the AMCON may become unsustainable for the banks. He conceded that as the pioneer Managing Director of AMCON, his call may sound ironic but will not take anything away from the validity of his position.
Finance Minister and Coordinating Minister of the Economy, Mr. Wale Edun, also speaking noted that over-regulation of the banking sector could stifle economic growth, adding that there was a need to strike a balance between regulation and compliance.
On the Tinubu administration’s efforts to revamp the economy, he said, “There is a strong recognition that the country has taken a bold step in the right direction. We are collaborating closely with the Central Bank to move in the right direction.”
He added, “Efforts are being made to bring in funds to shore up liquidity in the foreign exchange system.”
The CBN governor, Mr. Yemi Cardoso, who was represented by Dr Chibuzor Efobi, Director of Payment Systems, CBN, said achieving a balance between regulation and compliance is a typical dilemma in the industry but stressed that misconduct should not be tolerated. He said that regulations are necessary especially when the issue is who can participate in the industry.
